Electronic filing, tax preparers and participation in the Earned Income Tax Credit

Wojciech Kopczuk, Cristian Pop-Eleches

Research output: Contribution to journalArticlepeer-review

Abstract

In 2002 more than 18 million low-income individual taxpayers received the Earned Income Tax Credit (EITC). Despite its size, non-participation in this program is a concern and substantial effort is devoted by the IRS, local governments and many non-profits to address it. Using variation across states in the introduction of state electronic filing programs, we show that the introduction of electronic filing had a significant effect on participation in the EITC. Our results are robust to accounting for other welfare, EITC and IRS reforms introduced during the same period. We speculate that the impact of this policy change on the tax preparation industry played an important role in increasing participation.

Original languageEnglish (US)
Pages (from-to)1351-1367
Number of pages17
JournalJournal of Public Economics
Volume91
Issue number7-8
DOIs
StatePublished - Aug 2007

Keywords

  • Earned Income Tax Credit
  • Take up of social benefits
  • Tax preparers

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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